Hassai Project History & Background
The Company is pleased to advise shareholders it has entered into a Memorandum of Understanding (MOU) with Ariab Mining Company (AMC) to undertake due diligence on the Hassai VMS Copper Project (Block 11) (Hassai Project) for an exclusive period of 90 days, during which it retains the exclusive option to become AMC’s joint venture partner for the Hassai Project (Option). During this period, the Company is to complete formal legal, technical and other diligence required to exercise the Option, including the completion of an Incorporated Joint Venture and Shareholders Agreement.
The Hassai Project is 100% owned by AMC, an entity which is 95% owned by the Sudanese Government. Hassai is located in the Red Sea Hills desert, in north-eastern Sudan.
The Hassai Project has been in operation since 1992 and has produced in excess of 2.3 million ounces of gold to date. Mining operations at Hassai are presently suspended whilst technical and economic studies for a future VMS mining operation are completed.
The Ariab VMS-oxide gold district contains over 20 oxide gold deposits. Several of these deposits have large copper-gold (+ Zn + Ag) sulphide resources below the oxide gold resources, including, Hadal Awatib East (67.8 Mt), Hassai South (42.1 Mt) and Hadayamet (8.4 Mt). It is these large sulphide resources that represent the project opportunity. For the avoidance of doubt, Abyssinian has no rights to gold bearing material on the surface, in dumps or in tailings dams.
Set out below is a simplified geology of the Ariab VMS–oxide gold district, north-eastern Sudan, and representative deposits.
Set out below is the geology of Hadal Awatib area. It is noted that the continuous strike length of Hadal Awatib massive sulphide lens is 3.1 + km, extending intermittently to west along the Metadip EM anomaly trend.
It is considered that the Hadal Awatib East VMS historical resource comprises only one third of a giant sulphide lens, which extends for more than 3.1 km continuously along strike, making it among the most extensive VMS deposits known globally.
Only Kidd Creek, Ontario (3.1 km to depth), and Neves Corvo, Portugal (3.4 km length), are comparable in size.
Presently Hadal Awatib East and Hassai South are the two main deposits that form the Hassai VMS Project. Hadal Awatib East is located about 12 km north of the current plant, and Hassai South is immediately south of the plant.
With the aim to developing the significant copper resource outlined to date, AMC has undertaken a number of technical studies, drilling programs and a Pre-Feasibility Study (PFS).
Upon exercise of the Option and completion of the requisite legal documentation to give effect to the incorporated joint venture (JV), Abyssinian will have a 49% equity share in the Hassai VMS Project and will be the Manager of the JV. The Government of Sudan will be the Company’s JV partner holding 51% through its shareholding in AMC.
Pursuant to the terms of the MoU, upon exercise of the option The Company will sole fund through to a decision to mine. Furthermore, it will be responsible for procuring the requisite project funding for the development of the project.
In terms of equity requirements, after the procuring project finance, each party will be responsible for their respective equity contributions may be required to complete project financing requirements.
Upon completion of the due diligence and legal documentation, it is the intention of Abyssinian to outline a JORC compliant resource and advance the project with a view to undertaking a Definitive Feasibility Study (DFS) on the Hassai Project. Some images and photos of the Project and surrounding terrain are set out below under “Images of the Project”.
With respect to the due diligence on this opportunity, the Company has already commissioned a team of well credentialled international mining consultants to undertake the various technical activities. The technical team includes CSA Global, DRA-Senet and Perenti. Additionally, the Company has appointed legal and financial advisors to work on the various due diligence work streams.
